No. 92-075 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1992 

IN RE THE MARRIAGE OF 

WILLIAM RICHARD CARAS, 

Petitioner and Respondent, 

and 

LAURI CHRISTINE CARAS, 

Respondent and Appellant. 

APPEAL FROM: District Court of the Fourth Judicial District, 

In and for the County of Missoula, 

The Honorable Ed McLean, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Noel K. Larrivee, Larrivee Law Offices, Missoula, 

Montana 

For Respondent: 

Richard Reep, Reep, Spoon & Gordon, Missoula, 

Montana 

< ~, Submitted on Briefs: June 25, 1992 

AUG6 - 1992 ~ecided: Ausust 6, 1992 
Justice John Conway Harrison delivered the Opinion of the Court. 

This is an appeal from the Fourth Judicial District Court, in 

and for the County of Missoula, the Honorable Ed McLean presiding. 

Lauri Christine Caras appeals from the final decree of dissolution 

which was entered by the Fourth Judicial District Court, Missoula 

County, on November 22, 1991, which converted the prior decree of 

legal separation to a decree of dissolution, and incorporated the 

parties1 prior marital and property settlement agreement by 

reference. We reverse. 

The sole issue on appeal is whether the marital and property 

settlement agreement executed by the parties should be set aside on 

the grounds that the agreement is unconscionable. 

In August of 1978, William ~ichard Caras (William) and Lauri 

Christine Caras (Lauri) were married in California. Two sons were 

born of the marriage; David, born June 9, 1980 and Nicholas, born 

November 16, 1983. 

In December 1988, the partiest marriage began to deteriorate 

and William mentioned divorce but Lauri refused. She showed signs 

of depression, withdrawal and weight loss throughout 1989, and in 

1990 family and friends intervened when Lauri was totally 

withdrawn. Lauri's condition prompted ~illiam to schedule a 

marriage counseling appointment for the couple. They attended just 

one session as a couple; Lauri, however, continued individual 

counseling between April and June 1990, in hopes that the 
counseling would aid in a reconciliation with William. In July 

1990, Lauri suggested, and the parties Later agreed, that she 

should attend school in Franklin, Tennessee. Although William was 

in favor of Laurirs schooling, he still desired a divorce. Lauri 

hoped the change would avoid divorce and help the marriage. About 

this time, the couple began the process of establishing a Marital 

and Property Settlement Agreement (the Agreement). To that end, 

William contacted attorney Rick Baskett (Baskett) who previously 

represented him in various business matters, and discussed with him 

the specifics of the Agreement. However, due to William and 

Baskettrs mutual social and other associations, Baskett referred 

William to another attorney, Rick Reep. 

Lauri met with Baskett individually after determining that a 

divorce was too drastic a step and decided to attempt a legal 

separation. Lauri alleges that Baskett told her she was possibly 

entitled to a larger property settlement than what had been drafted 

in the Agreement, but suggested that in order to maintain a 

friendly relationship with William and not to impact his business 

in a negative manner, she should sign the Agreement. 

The Agreement addressed various matters including custody, 

visitation, maintenance, and property distribution. The record 

indicates that Lauri understood the Agreement to be an interim 

agreement and not the final word on these issues if the matter 

actually proceeded to dissolution. Lauri also alleges that Baskett 

advised her to wait until her husband filed for the divorce at 
which time she could move the court to have the Agreement 

overturned. Lauri signed the Agreement in August of 1990 and 

departed for school in Tennessee. The executed agreement was filed 

with the District Court on August 31, 1990. On October 11, 1990, 

the court issued a decree of legal separation which incorporated 

the partiest Agreement. 

Lauri discontinued her Tennessee schooling sometime early in 

1991 for various reasons including her individual counseling 

sessions. She also met with William and their children several 

times in Tennessee and California. Lauri remained in Tennessee 

until approximately April of 1991, when she returned to Missoula in 

an unsuccessful attempt to resolve the marriage problems. 

On May 17, 1991, William filed a motion to convert the legal 

separation to a final decree of dissolution; that motion was 

granted on May 21, 1991 by Judge Jack L. Green. Lauri contacted 

Baskett to have the order set aside and on July 1, 1991, Judge 

Green did set aside entry of decree of dissolution and removed 

himself as the judge. Judge John Renson also recused himself from 

the matter and Judge Ed McLean assumed jurisdiction of the matter 

on July 10, 1991. 

Judge McLean held a hearing on July 31, 1991 regarding the 

issues of whether the decree of separation should be converted to 

a decree of dissolution and, secondly whether the Agreement should 

be set aside. At the July 31, 1991 hearing, Judge McLean carefully 

set forth time constraints for motions and briefs. Baskett did not 
file any brief or make any response to the court's directive of 

July 31, 1991. Baskett sent Lauri a stipulation which she alleges 

she was confused about signing. She alleges that Baskett told her 

that it was the only means to get the money that William owed her, 

but she refused to sign the stipulation. 

William again filed a motion to convert the decree of legal 

separation entered by the court on October 11, 1990, to a final 

decree of dissolution, incorporating all terms and conditions set 

forth in the Agreement. On November 22, 1991, after no filings 

were made by Lauri for a period of nearly two months, the court 

granted William's motion and entered the final dissolution decree, 

as requested, which incorporated the Agreement. With new counsel 

of record, Lauri now appeals to this Court. 

The issue in the case at bar cannot adequately be reviewed by 

this Court because the final decree of dissolution contains no 

findings regarding the conscionability of the Agreement. The 

entire contents of the final decree dated November 22, 1991, is as 

follows: 

Upon Motion by Petitioner and good cause appearing, the 

Court orders that the Decree of Legal Separation entered 

by the Court on the 11th day of October, 1990, be 

converted to a Final Decree of Dissolution incorporating 

all terms and conditions set forth within the parties' 

Marital and Property Settlement Agreement as adopted by 

this Court in the Decree of Legal Separation previously 

referenced. 

While we will not discuss every term in the Agreement, with 

regard to the property division aspects of g 40-4-202, MCA, that 
statute establishes the criteria under which such property should 

be distributed. The court may "finally equitably apportion between 

the parties the property and assets belonging to either or both, 

however and whenever acquired." Section 40-4-202, MCA; also see In 

re Marriage of Scott (Mont. July 21, 1992), No. 92-081, Slip Op. at 

5. The statute then lists factors which the court must consider in 

property distribution. The above-referenced decree contains no 

reference to the required criteria. 

This Court is not unmindful of the fact that both parties 

signed the Agreement in August of 1990 as a prelude to the legal 

separation proceeding. However, the record indicates that there 

was substantial confusion regarding the parties1 understanding of 

the long-term ramifications of the Agreement. Lauri repeatedly 

indicates that she believed the Agreement to be temporary or 

interim in nature while the couple pursued restoration of their 

marriage. The record indicates that with her departure to 

Tennessee fast approaching and her understanding of the temporary 

nature of the Agreement, she signed the Agreement. Lauri was 

apparently lead to believe that upon the initiation of actual 

divorce proceedings, the provisions of the Agreement could be 

replaced or revised. 

In the case at bar the District Court should have addressed 

the conscionability of the Agreement especially in light of the 

circumstances and understandings of the parties; in particular, the 

fact that the Agreement was signed in August of 1990 and the final 
decree of dissolution which incorporated it was entered in November 

of 1991. Accordingly, we vacate and remand this matter back to the 

District Court for findings as to whether or not the Agreement is 

conscionable. If found unconscionable, the decree of dissolution 

should be set aside and an equitable division of the property and 

all related matters should be addressed. Reversed and remanded to 

the District Court. 

We concur: 

A 'r